This group investigates the molecular mechanisms that determine the intracellular localization and sorting of integral membrane proteins within the endocytic and secretory pathways. This past year, our work has been directed towards identifying and characterizing: (i) structural signals that specify localization and sorting of integral membrane proteins, (ii) proteins that recognize the sorting signals, and (iii) other components of the sorting machinery. The nature of signals involved in sorting of integral membrane proteins was investigated using as models a molecule involved in antigen presentation, HLA-DM, and the endopeptidase, furin. HLA-DM is localized to an endosomal/lysosomal compartment where class II molecules of the major histocompatibility complex (MHC) encounter and bind antigenic peptides. Our studies showed that targeting of HLA-DM to this compartment is largely mediated by a tyrosine-based signal (YTPL) in the cytoplasmic domain of the beta chain of the molecule. Furin is predominantly localized to the trans-Golgi network (TGN). Molecular dissection of furin demonstrated the existence of two targeting signals that contribute to the localization of furin to the TGN: a tyrosine-based signal (YKGL) and a novel acidic sequence (WQEECPSDSEEDEGRGER). This novel acidic signal was shown to be a site of phosphorylation by casein kinase II, suggesting a role for phosphorylation in regulating the trafficking of furin. A search for proteins that bind to tyrosine-based signals resulted in the identification of the medium chains (micro1 and micro2) of clathrin- associated adaptor complexes (AP-1 and AP-2) as the signal-recognition components of the sorting machinery. This finding opened the way for a detailed characterization of the interaction of signals and recognition proteins at a molecular level.